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Future ownership of presidential yacht uncertain

1/28/2013

A 104' craft-built yacht that played a unique role in U.S. presidential history is at risk of being purchased by a foreign company.

The U.S.S. Sequoia, first pushed into government service in 1931 by President Herbert Hoover, could end up in the possession of India-based FE Partners.

Since last summer, the company has provided money to help maintain the famous vessel.

Current Sequoia owner Gary Silversmith, who bought the yacht in 2000, nearly a quarter of a century after President Jimmy Carter had it sold at auction in an austerity measure, said he needed the $5 million from FE Partners because of the financial burden of keeping the Sequoia operational.

But because Silversmith and his company, Sequoia LLC, were subsequently slow in repaying the loan, FE Partners decided to exercise a clause in the loan agreement allowing it to purchase the $13 million yacht for $7.8 million.

Now, in response, Silversmith, an attorney, has gone to court in New York to block the move. Silversmith has also charged that FE Partners actually only paid out half of the promised $5 million, which only added to the yacht’s precarious financial situation.

“It’s sad what has happened,” remarked Larry Hutcher, an attorney for Silversmith. “We tried to amicably resolve the various issues with them, but this company is what I would call a predatory lender. And there are people like that.”

Silversmith lost an early round in the matter on Jan. 24 when Judge Charles Ramos of the New York County Supreme Court said that New York lacked jurisdiction in the case. Attorney Hutcher has since said that Silversmith will file in a new jurisdiction.

For its part, FE Partners has released a statement charging that after the initial loan agreement, the “Sequoia crewmembers and employees notified FE Partners of liabilities and other matters that had not been previously disclosed as required under the loan documents,” according to FE Partners officials. “While looking into these matters on our own, and with the assistance of forensic accountants and other professionals we subsequently retained, we uncovered a troubling pattern of financial, tax and other irregularities.”

President Hoover, a multimillionaire, liked the Sequoia because it was more modest in size than his own private 318' vessel and thus seemed better for the presidential image during the Great Depression.

Presidents Franklin Roosevelt and Harry Truman made key World War II decisions while onboard the yacht, while John F. Kennedy enjoyed his last birthday onboard the Sequoia in May 1963.

According to the author Conrad Black, in his monumental 2007 book Richard Nixon: A Life in Full, the Nixon family hated cruising on the Sequoia, “as they were leered at by passersby on bridges and from the shore and other boats, and now helicopters.”

But it seems clear that the yacht served as the site for one of the most pivotal moments in presidential history when Nixon, sailing on the Sequoia, finally decided to throw in the towel as president, resigning from office as a result of the ongoing Watergate scandal in 1974.

After the Sequoia was sold in 1977 for $286,000, it sat in drydock in Virginia and was used for private charter trips along the Potomac River.

“It is a sad plight for such a graceful piece of the furniture of our history,” lamented New York Times columnist Stephen Pickering in 2003.

Silversmith’s purchase of the vessel seemed to promise better things. Hutcher wants the court to block FE Partners’ move to buy the Sequoia and forge a new loan agreement with the company: “It’s a valuable vessel when you think of the people who used it and travelled on it,” the attorney said. “It is really irreplaceable in terms of memories and events.”

 


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